Sen. Thomas urges federal government to enact additional CARES protections

N.Y. State Sen. Kevin Thomas, a Levittown Democrat called on the federal government earlier this month to ensure New Yorkers receive the full benefit of the CARES Act.

The $2 trillion act, the Corona Aid, Relief and Economic Security Act, was passed late last month to help the tens of millions of Americans and the hundreds of thousands of businesses that have felt the severe impact of the long state of emergency and lockdown.

The act provides stimulus payments for individual Americans, as well as loans for businesses during the Covid crisis. Thomas, who serves as chairman of the Senate Consumer Protection Committee, articulated his reservations in a letters to Senate Minority Leader Charles Schumer, a New York Democrat, and Treasury Secretary Steven Mnuchin that the impact of the stimulus bill might be lessened once the crisis begins to recede.

In his letter earlier this week to Mnuchin, Thomas expressed concern that, while the act prohibits federal and state governments from garnishing or otherwise attempting to claim stimulus funds as payment for past-due debts, it does not protect recipients from private debt collection. Thomas urged Mnuchin to extend the same protections against private debt collection agencies.

“No New Yorker should find themselves without access to funds, unable to buy food, medicine or other necessities because of a debt collection judgment,” Thomas wrote. “Unfortunately, the Economic Impact Payments make individuals easy targets for creditors and debt collectors, who will use stimulus payments as an opportunity to collect old debts. The Department of Treasury must act urgently to ensure the Economic Impact Payments are kept in the hands of individuals who desperately need to prepare for and endure the coronavirus public health emergency.”

In writing to Schumer last week, Thomas expressed concern that the act did not adequately protect from foreclosure and eviction once the Covid-19 crisis subsides. A 90-day moratorium is in effect in most of the state, granting temporary protection, but Thomas expressed concern that New York’s more than 1.2 million unemployed would be unable to resume mortgage and rent obligations at the expiration of the moratorium or repay whatever arrears may have accrued in the interim.

In his letter to Schumer, Thomas urged the federal government to enact legislation that includes mortgage payment forgiveness and restrictions on evictions in cases where nonpayment was caused by a reduction in income. He also called for clear guidance on mortgage repayment after the moratorium is lifted, strong oversight authority from the Consumer Financial Protection Bureau [CFPB] and a moratorium on foreclosures for the duration of the state of emergency.

“No one should lose their housing during a public health crisis,” Thomas wrote.

Thomas has been part of a growing chorus of legislators concerned with the aftermath of the crisis, when accrued debt becomes due. “We won’t just go back to yesterday,” Gov. Andrew Cuomo said in an Aril 13 press conference.

And many, including officials at the Centers for Disease Control and Prevention, believe the virus may return later in the year. “We need to be prepared for round two, or even round three,” said Thomas’ Senate colleague John Brooks, a Democrat from Seaford.